Shanghai shares open up 0.8%; rest of Asia shrugs off Fed

Shanghai shares open up 0.8%; rest of Asia shrugs off Fed

An investor observes stock market at a stock exchange hall in Jiujiang, China.

ChinaFotoPress via Getty Images
An investor observes stock market at a stock exchange hall in Jiujiang, China.

China’s Shanghai Composite opened up 0.8 percent at 3,111.4 on Friday, tracking a turn in sentiment after the Federal Reserve cited concerns about global economic growth in its decision to hold off on its first rate hike in nearly a decade.

“In the grand scheme of things, the decision by the Fed to leave rates unchanged is indicative that the global economy and the U.S. economy is performing worse than previously projected,” IG’s market analyst Angus Nicholson wrote in a note.

Wall Street indexes gave up a 1-percent rally to end mostly lower overnight. The blue-chip Dow Jones Industrial Average and the S&P 500 slipped 0.4 and 0.3 percent respectively, while the Nasdaq Composite inched up 0.1 percent.

NIKKEI Nikkei 225 Index 18175.98
-256.29 -1.39%
HSI Hang Seng Index 21807.25
-47.38 -0.22%
ASX 200 S&P/ASX 200 5147.30
0.48 0.01%
SHANGHAI Shanghai Composite Index 3100.28
14.22 0.46%
KOSPI KOSPI Index 1978.43
1.94 0.10%
CNBC 100 CNBC 100 ASIA IDX 6419.41
5.47 0.09%

Nikkei loses 1.2%

Japan’s Nikkei 225 index and the broader Topix index accelerated declines at the start of trade.

Financials endured particularly heavy selling, with Sumitomo Mitsui Financial Group and Mitsubishi UFJ Financial Group tanking more than 2 percent.

Given that dollar-yen is near 119.98 compared to the previous session’s 120.90 , exporters kicked off Friday on the back foot. Blue-chip namesToyota Motor and Canon eased 2 percent each, while Panasonicslumped 2.4 percent.

Meanwhile, the Bank of Japan (BOJ) is set to release minutes of its policy meeting held earlier this week. The BOJ kept monetary policy steady on Tuesday, in line with expectations.

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ASX gains 0.4%

Australia’s S&P ASX 200 index turned positive by mid-morning trade.

National Australia Bank, Westpac and Australia and New Zealand Banking shed 0.7 percent each. Santos and Oil Search lost 1 percent each after West Texas Intermediate (WTI) eased 25 cents at $46.90 after the Fed’s decision.

The Australian dollar hit a three-week high of $0.7277 against the dollar following the policy announcement, but has since retreated back to $0.7178. In a testimony before parliament on Friday, Reserve Bank of Australia Governor Glenn Stevens said he is not especially concerned by the prospect of higher U.S. interest rates and expects a rate hike before the end of 2015.

Kospi adds 0.2%

South Korea’s Kospi index clawed back early losses to inch up above the flatline.

The index’s top weighted stock Samsung Electronics erased a 1-percent decline to trade flat, while Hyundai Motor skidded 1 percent.

Banking shares tracked the region-wide sluggishness; Shinhan Financial Group and Woori Bank plunged 3.9 and 2.7 percent respectively.

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Rest of Asia

Elsewhere in the region, Singapore’s Straits Times index opened flat

Meanwhile, Malaysian and Taiwanese shares edged down modestly in early trade.

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